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One of the many protections afforded during the public health emergency has been a freeze on rents across the District. The prohibition on rent increases during the emergency and 30 days thereafter applies to both rent-controlled and market-rate units.
Just as some are interested in ending the Council’s blunt eviction moratorium, some are interested in easing the rent freeze during the public health emergency that is set to expire May 20. Ward 2 Councilmember Brooke Pinto circulated a bill that would limit the ban on rent increases to tenants experiencing hardships related to the coronavirus pandemic. The Council is expected to consider her bill during the April 6 legislative meeting. She hopes to introduce it soon with some of her colleagues.
“This pandemic has affected residents very differently,” Pinto tells City Paper. “So to have a broad prohibition on all rent increases didn’t make sense as we go forward.”
Here is the proposal:
- Limit the prohibition on rent increases to tenants experiencing hardship. Tenants would prove hardship by signing a written attestation that says they’ve “qualified for unemployment benefits or experienced a reduction in household income, incurred significant costs, or experienced other financial hardship due, directly or indirectly, to the COVID-19 outbreak.” Pinto says landlords will have to inform tenants of this opportunity, although this is not explicit in the text of the bill.
- Extend the prohibition for qualified tenants to one year following the end of the public health emergency as opposed to 30 days.
- Allow landlords to increase rent on vacant units. As was the law before the pandemic, rent-controlled units can only increase by 10 percent if occupied for 10 years or less or by 20 percent if occupied for more than 10 years.
- Allow landlords of rent-controlled units to return rent to pre-pandemic rates (plus any increases or surcharges that were authorized but not implemented), if they decreased rent during the emergency and the unit became vacant. This exception to rent-control law, which limits increases to 2 percent plus the prevailing rate of inflation, would apply during the emergency and two years thereafter. Landlords would have to continue to grant tenants that accepted concessions reduced rent “unconditionally.” Rent increases and surcharges for occupied units have to be based on reduced rent.
“I think that this bill strikes an appropriate balance and is based upon dozens of conversations I’ve had with tenants and housing providers,” says Pinto. “But we are very open minded to making sure that this bill is the strongest version possible and are happy that we have enough time to hear from people to incorporate their feedback.”
What do people think?
Some tenant organizers that’ve been calling for rent cancelation aren’t happy with the proposal. “The pandemic isn’t over, and tenants are still out of work, sick, and unable to afford basic needs like food and medicine. Instead of finding a way to help them, Pinto is searching for ways to raise their rent,” says Allison Hrabar of Stomp out Slumlords, the housing advocacy arm of the Metro DC Democratic Socialists of America. “Extending the prohibition on rent increases to a full year is an excellent idea, but Pinto’s bill limits this protection to only some District residents, and forces them to jump through hoops to qualify. D.C. needs to provide universal protection and rent relief now, not waste time and money trying to stop residents from getting aid.”
Mayor Muriel Bowser’s so-called rental housing strike force weighed whether to recommend exempting vacant units and units that receive housing assistance from the prohibition on rent increases. The group of housing experts included these exceptions—along with allowing rent concessions during the emergency and a “phased return to ‘normal’”—in draft recommendations released March 12.
The strike force appeared to drop these ideas from their latest draft recommendations released March 19, after members were unable to reach an agreement in the previous meeting. The members have one last meeting this Friday before releasing final recommendations on how to resolve the rent crisis. It’s possible that the strike force will include something on rent increases.
Pinto is a member of the strike force. When asked why she circulated a proposal that the strike force couldn’t reach consensus on, Pinto says: “There certainly was discussion during the strike force meeting that some provisions are better left to the legislature and to make sure that we have community buy-in and go through the legislative process. I think that that is particularly true as it relates to rental increase exceptions and protections.”
Housing providers that are members of the strike force have been advocating to ease the prohibition on rent increases. These members fought to include their ideas in draft recommendations. “Increases on vacant units do not affect current residents, yet we are not able to take vacancy increases,” said Tom Borger, CEO of Borger Management during a March 12 meeting. “From my viewpoint, representing a lot of different landlords, being able to take increases … at turnover is absolutely necessary and it’s had all kinds of ramifications throughout the rental market. Apartments [are] off the market because they can’t take a rent increase.”
The strike force is stacked with members representing the interests of housing providers. One tenant association president was invited to participate, but she did not show up for the last two meetings. Beth Mellen, a tenant attorney at the Legal Aid Society of D.C., believes the city should not ease the ban on rent increases during the public health emergency.
“What landlords really are asking from the government is to protect them in every way possible to maximize profit during an economic crisis when tenants are suffering,” says Mellen. “The market has softened a little, which frankly is great for tenants who have been paying through the nose for years. It’s a needed correction to the D.C. market generally.”
The D.C. metro area saw some of the highest rent increases among major cities in the 2010s. Some tenants are rent burdened. One report said nearly half of renters spent at least 30 percent of their income on housing in 2018. The pandemic didn’t help and hit renters of color especially hard: One in four non-White renters deferred or missed rent.
Now, rents are dropping. According to DCist, the city’s rent decreases are driven by rent decreases in newly built units with more luxurious amenities. In October, the average rent for these units dropped from $2,669 to $2,387 per month. The pandemic led to trends like people leaving D.C., renters moving to buy, and some luxury apartments offering deals to attract new tenants.
Some tenant advocates argue that allowing rent increases on vacant units only incentivizes more vacancies. And the Reclaim Rent Control coalition says vacancy increases are partly to blame for high rents. Advocates also point out that landlords of rent-controlled units will have other means to increase rent by more than 2 percent plus inflation, like petitioning and seeking agreements with tenants. Through a hardship petition, for example, landlords can apply to raise rents enough to earn a 12 percent return on investment. (The coalition is trying to reform this to maintain affordability.) “It’s just contrary to the whole concept of rent control,” says Mellen of Pinto’s proposal around rent concessions, which has a history of surprise price increases for tenants that the Council worked to correct. “Rent control is supposed to be about stability and pricing, that the price increases are predictable for the tenant.”
Tenant advocates support some aspects of Pinto’s bill, namely the extension of the rent freeze from 30 days to one year after the emergency ends. “If we want to help landlords, what we need to be focused on is getting that rental assistance money out the door as quickly as possible. And that helps landlords and it helps tenants,” adds Mellen. She notes that there are millions of federal dollars coming to help landlords and tenants.
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